What are mineral rights?
If you have just inherited minerals, or found a royalty check you did not expect, this page is the short version of what you own, how you get paid, and what to expect over the years.
Reading a royalty statement, box by box
Here is a made-up statement. Every box that matters has a number, and the explanations below it say what the box means, what to check, and what other operators call it. Different companies use different labels; the numbers on this statement are all linked: volume times price is the gross value, gross value times your decimal is your share, and your share less taxes and deductions is what you are paid.
- Operator
- 1Sample Ridge Operating, LLC
- Owner
- 2Pat Q. Sample · No. SR-10482
- Check date / no.
- 302/27/2026 · 0048213
| 4Property | 5Prod. month | 6Product | 7Gross volume | 8Price | 9Gross value | 10Int. type | 11Decimal | 12Owner value | 13Taxes | 14Deductions | 15Owner net |
|---|---|---|---|---|---|---|---|---|---|---|---|
| HARTLEY 1H 100231 | 12/2025 | Oil | 3,840.00 bbl | $66.50 | $255,360.00 | RI | 0.00312500 | $798.00 | −$59.85 | — | $738.15 |
| HARTLEY 1H 100231 | 12/2025 | Gas | 21,600.00 mcf | $2.80 | $60,480.00 | RI | 0.00312500 | $189.00 | −$14.00 | −$14.55 | $160.45 |
| DUNMORE 3-14H 100877 | 12/2025 | Oil | 5,120.00 bbl | $66.50 | $340,480.00 | OR | 0.00050000 | $170.24 | −$12.77 | — | $157.47 |
| DUNMORE 3-14H 100877 | 12/2025 | Gas | 30,000.00 mcf | $2.80 | $84,000.00 | OR | 0.00050000 | $42.00 | −$3.15 | −$4.20 | $34.65 |
| VOSS 7-22H 101359 | 11/2025 | Oil | 2,900.00 bbl | $63.25 | $183,425.00 | RI | 0.00187500 | $343.92 | −$25.79 | — | $318.13 |
| Totals | $1,543.16 | −$115.56 | −$18.75 | $1,408.85 | |||||||
| 16Check amount | $1,408.85 | ||||||||||
Swipe the statement sideways to see every column.
- 1 Operator
What it is. The company that runs the wells and sends your check. It may not be the company that owns the wells.
What to check. The name and address match the company you expect, and you have a phone number or email for their owner relations team.
Also called: Payor · Company · Paid by · Remitter
- 2 Owner name and number
What it is. Who the check is written to and the number the operator files you under.
What to check. Your name is spelled right and the number is the same on every statement. Quote it whenever you call or write.
Also called: Owner no. · Payee number · Vendor number · Interest owner
- 3 Check date and number
What it is. The date the payment was issued and its check or electronic payment number.
What to check. The date lines up with the deposit. The number lets the operator and your bank find the same payment.
Also called: Payment date · Check no. · EFT / ACH number · Remittance date
- 4 Property
What it is. One well or lease, with the operator's own number for it. Each property is paid on its own lines.
What to check. You recognize every well. Operators often spell names differently from the state, so match them by county and number, not spelling alone.
Also called: Lease · Well name · Property no. · Entity · Prop code
- 5 Production month
What it is. The month the oil or gas was produced and sold, not the month you were paid.
What to check. Payment usually arrives a month or two later, and gas can lag more than oil. A line from a much older month is usually an adjustment.
Also called: Sales month · Prod. date · Month of sale · Accounting period
- 6 Product
What it is. What was sold: oil, gas, or a product made from gas such as natural gas liquids.
What to check. A well that makes both oil and gas usually has a line for each. A missing product is worth asking about.
Also called: Prod · Commodity · Code (O / G / NGL)
- 7 Gross volume
What it is. How much the whole well sold that month, before your share. Oil is in barrels (bbl), gas in thousand cubic feet (mcf).
What to check. It is in the same ballpark as the state's published figure for that well and month. Small gaps are normal.
Also called: Gross units · Property volume · Total volume · Well volume
- 8 Price
What it is. What the buyer paid per barrel or per mcf for this month's sales.
What to check. It is close to what oil or gas sold for that month and similar from one month to the next. Prices can sit a little below the headline price.
Also called: Price per unit · Avg. price · Unit price · Sale price
- 9 Gross value
What it is. The whole well's sales: volume times price.
What to check. Multiply the volume by the price; it should match.
Also called: Gross sales · Property value · 100% value · Total sales
- 10 Interest type
What it is. A short code for the kind of interest you hold in this property: RI is a royalty interest, OR an overriding royalty, WI a working interest.
What to check. The code matches what you own. A working interest also carries costs; a royalty usually does not carry drilling and operating costs.
Also called: Int. type · Type · Owner type code · Royalty / ORRI / WI
- 11 Decimal interest
What it is. Your share of the property, as a decimal. 0.00312500 means 0.3125 percent.
What to check. It matches your division order and does not change without a letter explaining why. The same number should repeat on each of the property's lines.
Also called: Owner decimal · Net revenue interest (NRI) · Interest · Decimal / DOI
- 12 Owner value
What it is. Your share of the gross value: gross value times your decimal.
What to check. Multiply the gross value by your decimal; it should match to the cent.
Also called: Owner share · Your share · Owner gross · Net value (before taxes)
- 13 Taxes
What it is. Production taxes the operator pays to the state for you and takes out of your share.
What to check. The amount is a steady slice of your share, month to month. A sudden jump is worth a question.
Also called: Severance tax · Production tax · Ad valorem · Tax withheld
- 14 Deductions
What it is. Costs taken out of your share, often for gathering, compression, treating or transport of gas. Many oil royalty lines show none.
What to check. You know what each deduction is for and it does not creep up. Ask for the detail if a line says only "other".
Also called: Post-production costs · Charges · Expenses · Marketing / transport
- 15 Owner net
What it is. What you are paid for the line: owner value minus taxes minus deductions.
What to check. Owner value minus taxes minus deductions should equal it.
Also called: Net amount · Owner net value · Net payable · Net revenue
- 16 Check amount
What it is. The total paid: every line's owner net added together.
What to check. It equals the check or deposit you received. If it is below the operator's minimum, the amount may be held and carried to a later month.
Also called: Total payment · Net check · Amount paid · Check total
More on this: how to read a royalty check stub, common deductions and questions to ask your operator.
What a mineral interest is
Land can be owned in layers. One person can own the surface (the ground you walk on and build on) while another owns the minerals beneath it: the oil and natural gas. Owning the minerals is called a mineral interest, and the rights that come with it are your mineral rights.
You do not have to live on the land, or anywhere near it, to own them. Most mineral owners never see a well. A company that wants to produce the oil or gas usually signs a lease with the owner: the company gets the right to drill, and the owner gets paid a share of what is sold.
Royalty, working interest and overriding royalty
Three kinds of interest show up on statements, and they pay differently.
- Royalty interest. A share of what the well sells, paid to the person who owns the minerals and leased them. A royalty owner does not pay to drill or run the well. Statements often mark it RI.
- Working interest. A share of the well's costs and its sales. A working interest owner helps pay to drill and operate the well, and gets a share of the revenue after those costs. Often marked WI.
- Overriding royalty. A royalty-style share carved out of a lease, usually held by someone who is not the mineral owner, such as a landman or a former lessee. It lasts as long as that lease does. Often marked OR or ORRI.
Most people who inherit minerals have a royalty interest. Your statement's interest type tells you which you have.
Your decimal interest
Your share of a well is written as a long decimal, like 0.00312500. It is what the well's total sales are multiplied by to get your part. A decimal of 0.003125 is a little under one third of one percent. More on the decimal.
Where the money comes from
A company called the operator drills and runs the well. It sells the oil and gas to a buyer, pays the state's production taxes, and sends each owner a share, usually once a month. Each payment comes with a revenue statement (the "check stub") that shows what was sold, at what price, and how your part was worked out.
Money arrives a month or two after the oil and gas are sold, so a check you receive in March is usually for sales made in January or earlier.
What happens to your rights over time
- Wells decline. A new well produces the most in its first year or two and then tapers off. Checks from a single well usually shrink over time, even when prices hold steady.
- New wells can be drilled. An operator may drill more wells that include your minerals. That can start new checks, and you may get a letter or a form to sign when it does.
- You can sell them. Mineral owners can sell all or part of their interest. Buyers make offers based on what the wells are expected to pay; it is worth knowing what yours are producing before you answer one.
- You can pass them on. Minerals are property, so they can pass to heirs. Operators usually need paperwork before they change who gets paid, and a lawyer in the state where the minerals are can tell you what is needed.
This is general information to help you read your statement. It is not legal, tax or investment advice. Your lease and your state's law decide what applies to you.
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